Mining boom so much hot air

ROSEMARY PENWARDEN
Last updated 14:41 24/01/2013

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OPINION: When state-owned coal company Solid Energy began buying up farms in Southland's Mataura Valley in 2006, no one knew what was coming.

Over the next few years it purchased more than 100 family farms, to get at the lignite (low grade brown coal) beneath.

Solid Energy then spent $29 million building a briquette plant at Craig Rd, Mataura, to turn lignite into hotter burning briquettes using new technology. There are no briquettes yet; there appears to be no market for them. But the plant employs six people at present - hardly a solution to local workforce issues.

The farms are now run on short-term leases by tenant farmers, who have been told not to make plans past March this year.

Solid Energy has not yet turned the Mataura Valley into New Zealand's largest open cast coal mine, but residents have been subject to the beginnings of a pattern associated with extractive mining everywhere; of boom and bust, broken promises and communities torn apart. It's a pattern we ignore at our peril.

From the Far North to Stewart Island, farmers and small communities are at the front line in the scramble for fossil fuels. We mirror the rest of the world, where fossil fuel companies carry on their books enough coal, oil and gas reserves to emit enough CO 2 to raise the world's temperature five times above the accepted "safe" two degree limit. It's not just broken promises we must watch out for. It's a broken climate. It's a broken world.

Details vary, but the pattern goes something like this:

First approach: A preliminary, "get-to-know-you" kind of meeting. The company approaches farmers individually, testing their response to mining on their land. The representatives talk about benefits - jobs, prosperity, better community facilities, schooling. But it's not as cosy a meeting as it might appear.

One of the mining representatives is likely to be a psychologist. They pick up on husband and wife conflicts and figure out how little money they can offer. The final contract contains a confidentiality clause. Once the first farmer sells, it can happen fast. In Mataura in 2006, Solid Energy spent $35 million in three months buying farms.

Divide and rule: The company holds "stakeholder" meetings, inviting some and excluding others. Yet good-will is a feature of rural communities. The company uses language that evokes this: ". . . we balance our business objectives with our responsibility to build strong communities where people thrive and the environment flourishes." - Solid Energy website.

Money talks: Money is tight in rural communities. The company sponsors schools, sports teams, community events, local arts; looking for projects that will build "social capital" - but only when it suits. "Clearly given the impact of the difficult global markets on our business, we have had to review our funding availability and have had to pull back on supporting a number of areas . . ." - Solid Energy's sponsorship and promotions manager, October 2012.

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It lobbies councils, promising prosperity and pushing for favourable terms. For example, the community had no say in the consent for the Mataura briquette plant. Boom: Once mining begins, some local businesses thrive - bars, cafes and restaurants, motel and hotel owners and property developers.

Many jobs go to out-of-towners who need accommodation, so rental properties become scarce and rents go sky high. House prices soar.

The company uses its own equipment, so local businesses lose out.

Young electricians, mechanics or plumbers abandon their careers and drive trucks or diggers in the mine. With convenient, well-paid jobs the incentive for higher education or skills training, unless it is in the mining industry, disappears.

Cost of improvements to roading and other infrastructure needed by the mining company regularly falls to local government.

The two-speed economy sets in. Those who work in the mine have the means to buy, rent, pay the higher prices at restaurants and so on. Out-of-towners show up for their shifts, then leave, with little community input. Those who don't work in the mine can no longer afford the increased cost of living. Single parents with young children, older people and beneficiaries suffer. Bust: When the coal runs out, or the price falls and there's no profit in it, the "bust" follows. Jobs are cut. Families leave because they can no longer pay mortgages. House prices crash. The mining town of Ohai was famous in 2006 for its $1 house sales.

That's the pattern.

I come from a small rural community. We do need jobs - but not the kind that disappear in a puff of toxic smoke when the price of coal drops and shareholders no longer make a profit. Nor jobs that destroy the climate.

We need jobs like those proposed in the Business and Economic Research Ltd report: A View to the South: Potential Low Carbon Growth Opportunities for the Southern Region Economy.

We need to leave the coal in the hole.

Solid Energy should ditch its ludicrous plans to destroy more of the Mataura Valley - before it is too late.

Rosemary Penwarden is a grandmother, a freelance writer, and a member of Coal Action Network Aotearoa.

- © Fairfax NZ News

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